Chinese SOEs make headway in mixed-ownership reform

2018-02-01
Xinhua

BEIJING — China has made steady progress in advancing mixed-ownership reform among State-owned enterprises (SOEs) in a bid to enhance competitiveness and improve financial performance.

More than two-thirds of China’s centrally administered SOEs and their subsidiaries have introduced outside investors, registered new firms, restructured or gone public.

Seven of the 19 SOEs, the first two groups of SOEs to implement ownership reform, have introduced more than 40 investors, injecting more than 90 billion yuan (about $14.29 billion), said Gao Zhiyu, an official with the State-owned Assets Supervision and Administration Commission (SASAC).

In 2017, centrally administered SOEs had set up more than 700 new mixed-ownership companies, introducing more than 338.6 billion yuan from the capital market.

Most of the mixed-ownership enterprises were in sectors such as property development, construction, building materials, telecommunications and mining.

SASAC designated another 31 SOEs as a third group of companies to pilot the reform last year, with 10 centrally and 21 locally administered SOEs. Currently, these enterprises are working on rolling out plans, according to Gao.

The listed central SOEs will be the main entities undertaking the reform. Their gross capital and profits accounted for 63.7 percent and 84.8 percent, respectively, of the total for all central SOEs, he added.

Mixed-ownership reform, which diversifies the ownership structure of SOEs, has started to take off in recent years as SOE monopolies in many sectors shut out smaller firms and led to inefficiency and poor service.

The pilot reform has paid off with improving competitiveness and dropping leverage levels.

SASAC will push forward mixed-ownership reform among more than 50 pilot enterprises in 7 key sectors, including electricity power, oil, natural gas, rail transportation, aviation and telecommunications, said Peng Huagang, deputy secretary-general of SASAC.